[ad_1]
Kenya added some 500 banking and insurance jobs in 2018, returning the sector to a growth trajectory after it shed 1,500 jobs the previous year.
The pace of new employment, however, remained slow despite offering a glimmer of hope to millions of job seekers in the sector hit by sustained layoffs and branch closures.
The Economic Survey 2019 shows the financial services sector (which includes insurance and banks) added the new jobs to reach 64,000 from 63,500 the year before. This represents a growth of a paltry 0.79 percent though.
Employees in the financial services remained the best paid private sector workers with those in financial and insurance services pocketing an average Sh153,667.50 a month, representing a growth of less than 4.8 percent.
Most banks have shifted from brick-and-mortar operations in favour of technology-based transactions, cutting bank payrolls. The sector witnessed the fastest jobs shrinkage ever recorded in 2017 after the number of financial services (banking and insurance) employees dropped 2.3 per cent in 2017 from 65,000 the previous year.
The banking and insurance sector data is specifically captured under a new metric introduced in 2011.
Commercial banks have deepened their automation in the past few year as they seek to improve efficiency and cut costs after profitability fell with the rate caps.
A number of lenders have since closed some branches and sent workers home as part of the cost-cutting effort expected to continue.
Unionists, have in the past accused the banks of employing tactics such as outsourcing in the quest for bigger profits.
Slow profitability growth following interest rate caps has been linked to the reduced or slower growth in sector wages.
Citi Global Perspectives & Solutions (GPS) predicted the looming staff cutback in a 2016 report that said that banks were quickly approaching their “automation tipping point,” and could soon reduce headcount by as much as 30 per cent.
The report on how financial technology is disrupting banks, said the institutions’ “Uber moment”’ would mean a shift to the mobile phone as the main channel of interaction between customers and their banks.
“We believe that there could be another 30 per cent reduction in staff during 2015-2025 period,” the report said.
[ad_2]
Source link
Kenyan Business Feed is the top Kenyan Business Blog. We share news from Kenya and across the region. To contact us with any alert, please email us to [email protected]
